The Central Bank begins the actual implementation of the comprehensive banking reform project.
The Central Bank begins the actual implementation of the comprehensive banking reform project.
2025-10-12
The Central Bank’s actions and efforts, in partnership and consultation with private banks, have been fruitful in facilitating the implementation of the objectives, programs, mechanisms, and standards of the comprehensive banking reform project. This was achieved in collaboration with the government and the global consulting firm Oliver Wyman, as well as the objectives and initiatives of its third strategy. The primary objective is to build a robust, modern, inclusive, and flexible banking sector that drives rapid growth for the national economy and contributes to achieving a cumulative increase in the gross domestic product and growth in the banking sector’s market value.
Given that economic reform begins with banking reform, the challenges facing the Iraqi economy and the opportunities for reform in the banking and financial sector are highlighted in the government’s program. The Central Bank’s future vision for the banking sector’s role in achieving sustainable development and investment is also highlighted, as are the current efforts to activate and revolutionize productive non-oil economic sectors to diversify sources of national income, achieve financial sustainability, and accelerate economic growth. The Central Bank’s role in regulating foreign trade financing, completing infrastructure projects to achieve comprehensive digital transformation, and expanding the use of electronic payment tools to achieve financial inclusion are also highlighted.
It will contribute to providing opportunities for reform, development, empowerment, and growth of the private banking sector during 2025-2028, as follows:
First: Developing the Iraqi banking system and its compliance with international banking and accounting standards.
Second: Building a sound, modern, comprehensive and flexible banking sector.
Third: Enhancing citizens’ confidence in the banking sector locally, and achieving international recognition of its transparency, progress, and strict adherence to international standards, as well as gaining the trust of reputable correspondent banks to deal with it.
Fourth: Rehabilitating restricted and weak banks to return to activity in the banking market with full internal and external activities.
Fifth: Transforming banks to their primary function, which is financing and bank lending for development, and enhancing financial inclusion and increasing its current rate as planned.
Sixth: Strengthening the procedures and decisions for the transition from a cash economy to a digital economy, withdrawing funds outside the banking cycle, which constitute approximately 80%, and introducing them into the banking system.
Although the period specified for its implementation according to the banking reform project and the Central Bank strategy is three years, what was achieved in 2023 and 2024 until June 30, 2025 in terms of building foundations, rules and pillars that formed a supporting pillar in building the mechanisms and paths of the desired reforms, and they constitute ambitious percentages, as announced, which will lead to the evaluation and classification of banks based on their achievement of the planned objectives in the reform project according to the internationally approved standards and criteria.
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